Olympic-Sponsorship Lines Blur

CHICAGO (AdAge.com) -- Samsung paid dearly to become the official wireless sponsor of the Olympic Games. Now it just has to figure out if the standard bells and whistles on many of its phones intrude on other major sponsors' exclusive turf.

Samsung, Panasonic and Kodak each shelled out more than $1 million to become one of the games' dozen "Top Programme" sponsors, which gives them exclusive rights to hawk wireless, audio/video and imaging devices, respectively, through the Olympic platform.

Once-distinct categories
When those deals were signed during the 1980s and 1990s, those categories were entirely distinct. Not anymore: Advances in technology have blurred the lines between cellphones and TV sets and stereo systems. In today's world, phones play videos and music files and take pictures -- so can Samsung market multimedia phones as the Olympics' wireless-marketing partner or is that massive piece of its new-product portfolio off limits?

"Ten years ago, it was clear cut," said Gyehyun Kwon, Samsung's head of worldwide sports marketing. "Now, what is wireless equipment? What is video? Now it's an argument."

While discussions concerning the "argument" continue, Samsung is attempting to soft-pedal the issue by emphasizing the wireless-communications aspect of its phones -- not their audio, video and photo capabilities -- through the Olympics, a step that could hinder sales efforts in a category dominated by ain't-it-cool appeals.

Until now, the sponsorships have been well worth the trouble, particularly in the markets where the games are held. Mr. Kwon said Samsung's Italian phone sales rose 80% after its role in the 2006 Turin Winter Games. Obviously a similar boost in China -- even if it's just in the northeastern section of the country, around Beijing -- would be hugely lucrative.

Complaints over a piece of tape
Those stakes may explain some of the apparent pettiness from sponsors trying to protect their exclusive rights. Mr. Kwon said Panasonic executives complained to him when a piece of tape concealing the Samsung brand name on a TV monitor at its Olympic Village installation disappeared. "This is the reality we're facing," he said.

An International Olympic Committee spokeswoman wouldn't address the discussions, and Panasonic did not respond to repeated inquiries.

But sports-marketing experts said conflicts over exclusivity have become increasingly common due to technological advances, consolidation and expanded services from marketers that soften the once-bold lines between categories -- something marketers have become less tolerant of as the cost of major deals has risen.

"You didn't used to have so much crossover," said Mark Lev, exec VP of Fenway Sports Group, a Boston-based consultancy that sells sponsorships for teams such as the Boston Red Sox and buys them for clients such as Dunkin' Donuts. "We run into this a lot more, and the discussion is much more intense."